GST registration for Director Remuneration

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This query is : Resolved

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If you receive director remuneration exceeding £20,000 annually and it's not classified as salary, you might wonder about GST registration. The consensus is that you, as the director, likely don't need to register. Instead, the company engaging you is responsible for paying GST under the Reverse Charge Mechanism (RCM). Importantly, the company can claim this RCM payment back as Input Tax Credit (ITC), effectively neutralising the GST cost.

Guruprasad

Guruprasad (Querist)
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23 February 2024 I am working in only one company as director and getting paid fee of more than 20 lakh per annum as director remuneration since I am not covered under salary. Do I need to get registered under GST ? Is it necessary to register since I am working full time only in one company.

Experts please help.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 February 2024 No GST registration is required.
In such a case GST under RCM payable by the company.

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Guruprasad

Guruprasad (Querist)
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23 February 2024 sir, thanks your reply. Once we pay GST from company side as RCM, I believe we will not able to claim that again as Input tax credit. should we have to treat that GST portion as an expense in company books?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 February 2024 ITC can be claimed on such RCM payment.